How Soil Type Affects Land Values

How Soil Type Affects Land Values

A farm’s greatest asset is its land. If you’re considering buying land with an ag land loan, looking into the land’s soil type is an important step in determining the worth of the property. It’s also an indicator of how much work the soil will need in order to provide a nutrient-rich environment for crops.

Six Soil Types

Soil classification is based on the texture and size of the particles in the soil, as well as on the mineral and nutrient content. The six most common soil types are loamy, sandy, peaty, silty, chalky, and clay. Each of these base soil types become naturally combined in varying ratios to produce entirely new and unique soils in each state.

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6 Soil types infographic

Graphic courtesy of AgAmerica Lending

Every part of the country has one, or a mixture, of the six main soil types. And just like each state has an official flower or bird, they also designate a state soil. Florida’s official soil is called “Myakka.” It originates from marine deposits and is a key component of Floridian flatwoods.

There are a variety of tools for assessing a farmland’s soil type. Chuck Cruse, AgAmerica’s Regional Account Manager for Florida, highly recommends heading to the USDA’s Natural Resources and Conservation Services (NRCS) web page. This tool allows users to create a map of their land or land that they are considering for purchase. The process takes the user through four basic steps: (1. Define your land area of interest; (2. Gain detailed descriptions of the soils in that area; (3. Access and save soil data and crop suitability data with the Soil Data Explorer; and (4. Order a free instant printable report, which creates a complete picture of the quality of a specified piece of land, including yield potential. The NCRS database currently contains data for 95% of the nation’s counties and anticipates having 100% in the near future.

Ask The Soil Experts

Different crops prefer different soils, so determining the soil’s compatibility with certain crops is a key concern for the region’s ag Extension office. Extension agents are familiar with the area while possessing access to an array of useful data when it comes to soil quality and which land offers the best yield, and for which crops.

The USDA also collects data on what’s known as “prime farmland designations,” which are based on physical and morphological (organic) characteristics such as the depth of the water table in relation to the root zone, potential moisture holding capacity, the degree of salinity, permeability, frequency of flooding, soil temperature, erosion potential, and soil acidity.

Data about a farm’s soil type is used to help create the land appraisal. Appraisals are a common part of securing a land loan and are a complex equation involving a variety of factors with soil quality being only one of them.

Land appraisers develop economic assessments of agricultural acreage using soil samples. To determine the property’s value, they’ll review past yield records, look at existing irrigation and/or potential for new irrigation, and examine border features to assess how these might impact soil productivity.

Soil value infographic

Graphic courtesy of AgAmerica Lending

Florida’s Black Gold

While the southeastern region of the U.S. has a wide array of soil types, there is a very unique and valuable soil type found prominently in Florida — muck soil. Otherwise known as “black gold,” muck is a highly fertile soil that has amendments and nutritional value present without having to fertilize or irrigate heavily. The value of a parcel that contains muck soil fluctuates based on the depth of the muck, which can range from 12 inches to 30 feet deep in some areas. The deeper the muck, the more valuable the property is. However, there are only small areas of muck located in the state of Florida, the largest mass of it bedding in Palm Beach County around the bank of Lake Okeechobee.

“Muck is where sugarcane is primarily grown,” Cruse says, “because it takes very a minimal amount of work to grow it. You can get three to four cuttings off one planting of sugarcane, depending on the variety. When the farmer rotates the cane with sweet corn or other vegetables, it helps recycle those amendments back into the soil naturally. Once they’re done growing the cover crop, they’ll go in and till that crop, putting the nutrients and supplements back into the soil that’s then used to grow another crop of cane that will last another three to four years.”

Many farmers are finding innovative techniques to duplicate this scarce “black gold.” For instance, there are some sugarcane growers that are farming the cane on what is considered sand land. While the soil is entirely different than the muck, they’re bringing in mud and peat substitutes from the mills to replicate the nutrient-rich muck soil.

“These folks have the opportunity to bring some, what they call, ‘mill mud’ back to their properties to put the amendments back into the sand soil,” Cruse explains. “This gives them the properties and nutritional products that mimic the muck soil and grow better crops, even though they don’t have any depth of muck on the sand land. These farmers are putting anywhere from 12 to 24 inches of mill mud on top of the sand to help get the crop’s roots to be hardier, stronger, and to produce a better crop.”